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September arabica coffee (KCU25<\/a>) on Monday closed up +1.95 (+0.57%), and September ICE robusta coffee (RMU25<\/a>) closed down -46 (-1.09%).<\/p>\n Coffee prices today on Monday settled mixed, with arabica coffee posting a 2-month high. \u00a0Below-average rainfall in Brazil’s coffee-growing regions is supporting coffee prices after Somar Meteorologia reported Monday that Brazil’s largest arabica coffee-growing area, Minas Gerais, received no rain during the week ended August 16. \u00a0<\/p>\n \u00a0<\/p>\n Coffee prices fell from their best levels on Monday, with robusta falling into negative territory on comments from Brazil’s Agriculture Minister Favaro, who said he believes his country’s coffee exports could be excluded from the 50% US tariffs on Brazilian exports.<\/p>\n The coffee market is awaiting clarity on US tariff policies, as President Trump has yet to exempt coffee from his 50% tariff on Brazilian exports. \u00a0The tariff could hurt sales of Brazilian coffee to the US and boost Brazil’s coffee inventories. \u00a0<\/p>\n Coffee prices have moved higher over the past two weeks when Brazil’s Trade Ministry reported on August 6 that Brazil’s July unroasted coffee exports fell -20.4% y\/y to 161,000 MT. \u00a0In related bullish news released last Wednesday, Brazil’s green coffee exports in July fell -28% y\/y to 2.4 million bags, according to exporter group Cecafe. \u00a0Cecafe said July arabica exports fell -21% y\/y, while robusta exports plunged -49% y\/y. \u00a0Cecafe said Brazil’s July coffee exports fell -28% to 2.7 million bags, and that coffee shipments during Jan-July fell -21% to 22.2 million bags.<\/p>\n A decline in ICE coffee inventories is supporting arabica prices. \u00a0ICE-monitored arabica inventories fell to a 1.25-year low of 726,661 bags last Thursday, before recovering slightly to 733,105 bags on Monday. \u00a0Also, ICE robusta coffee inventories fell to a 3-week low last Friday of 6,907 lots, mildly below the 2-year high of 7,029 lots posted on July 28.<\/p>\n The ongoing Brazilian coffee harvest is bearish for coffee prices. \u00a0Safras & Mercado reported August 8 that Brazil’s overall 2025\/26 coffee harvest was 94% complete as of August 6, ahead of the comparable level of 92% last year. \u00a0The breakdown showed that 99% of the robusta harvest and 91% of the arabica harvest were complete as of August 6. \u00a0In related news, Brazil’s Cooxupe coffee co-op announced Wednesday that the harvest among its members was 80.4% complete as of August 8. \u00a0Cooxupe is Brazil’s largest coffee cooperative and Brazil’s largest exporter group. \u00a0<\/p>\n As a bearish factor, the International Coffee Organization (ICO) reported August 6 that global June coffee exports rose +7.3% y\/y to 11.69 million bags. \u00a0However, cumulative Oct-Jun coffee exports were down -0.2% y\/y at 104.14 million bags.<\/p>\n Due to drought, Vietnam’s coffee production in the 2023\/24 crop year decreased by -20% y\/y to 1.472 MMT, the smallest crop in four years. \u00a0Also, Vietnam’s General Statistics Office reported that 2024 Vietnam coffee exports fell by -17.1% y\/y to 1.35 MMT. \u00a0 Additionally, the Vietnam Coffee and Cocoa Association reduced its 2024\/25 Vietnam coffee production estimate to 26.5 million bags on March 12, down from a December estimate of 28 million bags. \u00a0By contrast, the Vietnam National Statistics Office reported last Tuesday that Vietnam’s Jan-Jul 2025 coffee exports were up +6.9% y\/y to 1.05 MMT.<\/p>\n The USDA’s Foreign Agriculture Service (FAS) projected on June 25 that world coffee production in 2025\/26 will increase by +2.5% y\/y to a record 178.68 million bags, with a -1.7% decrease in arabica production to 97.022 million bags and a +7.9% increase in robusta production to 81.658 million bags. \u00a0FAS forecasted that Brazil’s 2025\/26 coffee production will increase by +0.5% y\/y to 65 million bags and that Vietnam’s 2025\/26 coffee output will rise by 6.9% y\/y to a 4-year high of 31 million bags. \u00a0FAS forecasts that 2025\/26 ending stocks will climb by +4.9% to 22.819 million bags from 21.752 million bags in 2024\/25. \u00a0However, Volcafe is projecting a global 2025\/26 arabica coffee deficit of -8.5 million bags, wider than the -5.5 million bag deficit for 2024\/25 and the fifth consecutive year of deficits.\u00a0<\/p>\n On the date of publication,<\/p>\n